1 BN AuM HF Vs Tier 2 Strategic Consultant
Hi guys, I am trying to make a life choice here. So I would really appreciate if you could give me as many perspectives as possible.
Background: Top tier EU MBA (LBS / INSEAD)
Pre-MBA: big corporate / equity research
Opportunities:
1. Tier 2 strategy consultant (unfortunately didn't land an MBB offer as the the climate is horrible for MBA hire).
- 1Bn Aum L/S Hedge Fund based in London (not sure if I will get carried interests, but I will be given the opportunity to invest in the fund, so I would assume some of the bonus will be in the equity form of the firm)
Assuming the base salary is similar. What's the exit for both paths post-MBA? Assuming I will happily be a strategy consultant and then exit to PE / big corporate or be a hedge fund associate and ride this position.
Please let me know if any other details I shall provide for further discussion :) Thx a lot everyone.
You don't ride a hedge fund position. If you can't add value at a hedge fund, I will fire you in 1-2 years. If you aren't passionate about stock picking, do strategy consulting.
L/S hedge funds don't exit to corporate as well as consultants / bankers / private equity peeps.
Accurate. OP, I would not join the hedge fund unless you are exceptionally passionate about public markets investing. Anything less and you will be out the door one way or another in 2 years.
Is it a single manager fund? If so, I would take the HF job. Normally one of the cushier seats in the active management industry. Not as cushy as LO AM, but not brutal like the multi-manager grind. Analysts and senior analysts can normally spend many years at a shop and a team before moving over to another similar shop. Can also go down the multi-manager route if you want to.
Thank you very much for your advice!!
Indeed it is. Single manager fund. The position is long-hold too , as far as I understand. Team is pretty lean.
Sounds like a good seat to me. I would also look into how much AUM has grown since inception, background of the head guys, and what their performance has looked like. It currently seems like a more compelling risk/reward opportunity to consulting.
They have grown from under 100M to 1Bn AUM in 5 years, I’d say it is very impressive. Can I ask how easy / difficult it is to change from HF to HF? What’s the exit opportunity look like? Let’s say, I am made redundant, what’s the route afterwards?
Not sure about how difficult it is to move from fund to fund on the SM side. I know on the MM side it'll depend on whether you were in a risk-taking role or not. As an analyst it's probably easier to find a seat. Also not sure how you would be made redundant unless the firm has a really bad year and has to let people go. Exit opps are probably going to be within investment management or something markets-related. There's always a way to find your next role though so I would not be too worried about that tbh.
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